Home General Info & Awareness Making Money Go Further With Passive Income

Making Money Go Further With Passive Income

by InvisiblyMe
A photo of a person's hands on a table in front of her counting out a handful of bank notes. In front of her is also a notebook and pen. Below is the post title: Making Money Go Further With Passive Income.

Passive income can be useful for anyone, but for those with chronic illness it could be all the more useful. If you lose your job, can’t work like you used to, or perhaps are looking to retire, passive income could be one way to make your time, energy & money go a little further. This collaborative post isn’t going to apply to everyone, but it’s worth learning about how it works and whether there are any avenues you could explore in future for some extra pennies.

Passive income has been increasingly talked about in recent years. It’s something that advice articles often encourage you to earn, but what exactly does it mean and how can you earn a passive income?

Thankfully, it’s a relatively concept easy to understand, but developing this sort of income is not as easy and it won’t be an option or of interest for everyone. However, there are people who may be able to eek out a passive income without realising it.

What Is Passive Income?

Simply put, active income is money you make when actively working for it. When you go to work every day or do set tasks while working self-employed from home, you’re actively earning an income. By contrast, passive income is where you generate money without needing to do something continually on an ongoing basis. Money is earned as you can do other things, therefore, you are essentially earning income passively. 

Having said that, this doesn’t mean you don’t put in work at some point. Most methods of generating such income require some setting up beforehand, whether that’s looking for savings accounts, investment opportunities or writing an eBook.

In most instances, passive income is likely to be subject to income tax. Ensure you know the rules around tax so that you can declare it as required, including if you’re in receipt of benefits.

How Can You Earn Passive Income?

Investments

There are various options when generating passive income, some of which are simpler than others. Investments are perhaps the most obvious, being something that involves the least amount of effort once the money is invested.

Essentially, you can invest in things like the stock market, bonds or Forex. The idea is that you invest in different assets, then they appreciate in value of time. Eventually, you can sell them for a bigger profit and you have earned money without doing anything other than setting up the investments. With websites making investments and navigating the stock market a little easier, more people seek to learn the ins and outs of it online and invest shares on their own steam. Some people can do very well with this sort of passive income, and the starting cash required can be quite low in some cases. Caution should be applied, however, because there are no guarantees in investments and you should carefully consider your options and know what you’re doing before risking your cash.

A similar approach can be found in property investments, but this time you’re investing in property to earn passive income by renting it out. Again, you’re basically earning money in your sleep as renters pay you every month. If you had the money to do so, you could increase from one to two or three rental properties to boost the income stream. Alternatively, some people buy a property requiring work cheaply, renovate it and sell it at a profit. Of course these routes require a heavy lump of money initially to see the returns, so unfortunately not as many people will have this as an option.

A jar of money to the right, and four stacks of coins to the left lined up next to it. They all have green shoots coming out of the top to illustrate the process of saving money or passive income.

Bank Accounts

If you have some savings then a decent ISA could generate interest on what you already have, and even some savings accounts pay a small amount of interest. If you don’t want your money tied down or the risk of penalties should you need to take money out, then instant access options are perhaps more suitable. The better rates are usually with those where you leave your money for a set period of time. It always pays to shop around to see what’ll work best for your money and your situation.

Business & Royalties

Other ideas include starting a business, then taking a step back and letting others run it for you. Or, if you’re a creative individual, you can earn money from royalties. This is when you have licensed products that people have to pay to use – such as music, digital art or photos.

Affiliate Marketing

Affiliate marketing could be considered passive income. This is where you sign up to an affiliate program, either one that incorporates lots of brands or directly with the brand you want to link to, then leave specially-created links on a website or social media. These links then generate a small percentage of affiliate earnings when someone buys via them.

Book / eBook Sales

Writing and publishing a book is something that could dribble in income over time, too. It’s active work while you write it of course, but if people buy it for the months and even years thereafter then you could have a nice surprise with the passive income that accrues over time. More people are turning to the likes of free e-publishing, such as with Kindle books. You can write about anything you wish, whether it’s fiction, non-fiction, a how-to guide, poetry, self-help tips, a memoir and so on.

What Are The Benefits Of Earning Passive Income?

For those currently employed, passive income can be a side-earner for extra pennies while still working a full or part time job. For those who are unable to work for whatever reason, for those with chronic illness who perhaps can’t work like they used to, or for those in retirement, passive income is an avenue that requires a little less time and energy to make your money go further.

The knock-on benefit is that increasing your income can help reduce the pressure of money worries and the stress that comes with it.

The dream for many might be to earn enough passive income that you don’t have to worry about money again and can go without your day job. That’s not realistic for most people, but it can happen in some rare cases. If nothing else, it’s a little extra money to put aside or pay off bills and debts, helping your overall wellbeing and financial health in the long run.

A black scroll divider.

Caz  ♥

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9 comments

Popping Wheelies August 1, 2021 - 5:56 pm

Indeed, it doesn’t take a lot to eventually become significant. It’s not quick, and there is the temptation to spend it. Over time, passive income is quite valuable.

Reply
Ashley L. Peterson August 1, 2021 - 7:17 pm

My parents taught me well to make sure any savings I have are always working passively for me as best they possibly can. One of the banks I deal with shows me on my online banking how much I’ve accumulated in interest total over the years of dealing with them, and that currently stands at over $4K. Yay for passive money!

Reply
Despite Pain August 2, 2021 - 3:53 pm

I used to say that you needed to have money to make money and that could be said about some sources of passive income. Banks are giving virtually no interest unless you have a fair bit of money tied up for a while. But as you’ve described, there are many other avenues to explore. Thanks for this post. Very helpful, Caz.

Reply
Terri, Reclaiming Hope August 2, 2021 - 3:57 pm

This is great information Caz. What many people don’t realize is that those ‘little’ amounts continue to grow and become ‘big’ amounts if we just let them sit there and continue to grow. The point about an ebook becoming a source of passive income once you’ve done the initial work is brilliant. It’s not so passive when you’re actually doing the work, but it could continue to bring in income for a long time…. Now, if I could just write a book….????

Reply
Kymber August 2, 2021 - 4:07 pm

This is all good to know! I think I’ll be looking into some of the ways to earn passive income that you listed. Thank you, Caz. xo

Reply
The Oceanside Animals August 3, 2021 - 4:44 pm

Charlee: “Oooh! Our Dada writes books and has them for sale on Amazon!”
Chaplin: “He must have all kinds of passive income that we don’t know about!”
Lulu: “Let’s go hit him up for new toys and more treats!”

Reply
James Viscosi August 3, 2021 - 5:35 pm

Yeah, don’t expect many treats or toys from my last $2 royalty check, you guys.

Reply
Blanca August 5, 2021 - 9:40 am

Some people have a really good eye to make money with passive income. It´s something I should consider at some point. You are absolutely right, it can be a very useful way to make money for people suffering from a chronic illness. Thank you for sharing!

Reply
Kally August 26, 2021 - 3:49 am

Awesome and useful tips!

Reply

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